Davis Mendez on Building a Trusted SFR Investment Business

Written by:

Steve Marcinuk

Date:

09 May 2025

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“I bought my first piece of property when I was 19. I purchased land for 500 dollars that was headed to tax auction. I gave the owner 500 dollars and assumed his tax liabilities. From there, I put a big sign on it that said, ‘We buy houses.’ That 500 dollars turned into a $25,000 flip,” recalls Davis Mendez, founder of Sunbelt Homes.

This entrepreneurial origin story captures the essence of Mendez’s approach to real estate: identifying opportunity where others see problems, taking calculated risks, and leveraging creative strategies to generate returns. It’s an approach that has guided him from his early days as a college student to becoming a respected player in the single-family residential (SFR) investment space.

From College Student to Real Estate Entrepreneur

Mendez’s entry into real estate wasn’t part of a grand plan but rather a practical suggestion from his mother. “I was in college pursuing my degree, and my mom suggested getting my license and doing deals while in school as a flexible way of earning income,” he explains.

Starting in 2018, Mendez began working for a broker handling new construction sales. His background in construction labor jobs during high school made it a natural fit, but he quickly realized his interests lay elsewhere. “I wanted to pursue the investment route, and working for a traditional brokerage wasn’t the optimal way to learn that business,” he says.

This realization led him to explore alternative methods of finding deals, beginning with tax delinquent lists through the local tax assessor. This approach opened doors to wholesaling properties to other investors and eventually to capital raising opportunities.

The turning point came when Mendez met an investor who owned multiple multi-family condos. “He was lending us money. We were splitting the profits on the fix and flips. Through that experience, I recognized SFR’s potential for creating sustainable income and building a deal-generating business,” Mendez recalls.

The potential was so compelling that Mendez made the decision to leave college in 2019 to focus on real estate full-time. “It’s probably the best decision I ever made,” he reflects. “The journey hasn’t been easy, with many ups and downs. But now we’re working with larger institutional clients and completing flips in multiple states.”

Adapting to Market Shifts

Like many in the real estate sector, Mendez has had to adapt his business model to changing market conditions. “With COVID and everything, we really wanted to enter the buy and hold space. But as interest rates rose, it became challenging to make deals work financially from a rental perspective,” he explains.

This challenge prompted a strategic shift: “We’ve adjusted our model to focus more on fix and flips, primarily in the Atlanta market.”

Beyond Atlanta, Sunbelt Homes has expanded its acquisition business to include brokering and wholesale deals, as well as portfolio disposition and acquisition for regional and institutional clients. Their geographic footprint now includes markets like Dallas, Oklahoma City, Midwestern cities such as Kansas City, St. Louis, and Indianapolis, as well as South Carolina and northern Florida markets like Jacksonville.

“We source off-market, typically discounted homes in those markets for clients. These properties often need work, allowing buyers to acquire them at favorable prices while still having room for value-adding improvements,” Mendez explains.

Building Trust in a Skeptical Market

In an industry often challenged by questionable practices and inflated expectations, Mendez emphasizes the importance of professionalism and realistic assessments. “Many clients recognize that we’re more professional than others in our space. We understand the investor perspective because we’re investors ourselves,” he says.

This investor perspective informs their approach to deals: “We carefully underwrite our numbers, and when we present a deal, it should make financial sense, unlike others who may offer highly inflated properties or create unreasonable seller expectations.”

Mendez believes this approach is particularly important in the current climate. “There’s limited trust in real estate right now,” he observes. “Our priority is restoring confidence among property owners and investors that we’re committed to ethical practices and creating deals that benefit everyone involved.”

This commitment to transparency extends to their business model. “If we can facilitate successful transactions where everyone benefits and we earn our fee, that represents a fair deal for all parties,” Mendez says. “Our primary goal is building a trusted brand known for authenticity.”

Scaling Through Technology and Strategic Partnerships

Sunbelt Homes’ evolution from a small operation in Athens, Georgia, to a multi-state enterprise working with institutional investors has required significant operational adjustments. Initially, the company leveraged overseas workers to manage costs while benefiting from their experience with similar business models.

“We expanded significantly in 2019 and 2020, growing to approximately 35 employees,” Mendez recalls. However, market uncertainties during COVID and rising interest rates prompted a strategic downsizing. “Now we operate with a smaller domestic team of agents focused on identifying quality deals for our investors.”

Technology has been crucial to maintaining efficiency with a leaner team. “Our custom-built CRM helps us effectively manage deal flow,” Mendez explains. “We’ve invested heavily in automating systems through AI and integration over the past year, which helps maintain consistent deal flow.”

Data partnerships have also been instrumental in their success. “We’ve established valuable data partnerships with organizations that have histories of sourcing information for banks and lending firms,” Mendez says. These relationships provide access to targeted, accurate data that allows Sunbelt Homes to identify properties matching their criteria or their institutional clients’ requirements.

Market Insights and Future Opportunities

Mendez sees promising signs in the current market landscape. “Institutional investors are cautiously re-entering the market and evaluating available deals. They’re beginning to make selective purchases,” he notes.

However, the best opportunities aren’t necessarily in the most obvious locations. “We’re finding more financially viable deals in suburban markets like Augusta, Georgia, rather than in Atlanta itself,” Mendez explains. “The areas just outside major metropolitan centers continue to offer strong opportunities.”

Looking ahead, Mendez is particularly optimistic about Midwest markets, which have traditionally been viewed primarily as cash flow investments rather than appreciation opportunities. “Investors are showing strong conviction in Midwest markets for cash flow, but I believe there’s also potential for appreciation,” he suggests.

This appreciation potential could be driven by broader economic trends. “With manufacturing returning to the US in the coming years, the Midwest is generating significant interest,” Mendez observes. “There’s an opportunity to purchase properties at favorable prices that generate immediate cash flow. This combination is advantageous compared to markets offering minimal cash flow.”

Specific markets that have caught Mendez’s attention include Detroit, Indianapolis, and Ohio generally. However, he remains “optimistic about the Southeast long-term. The Southeast has substantial growth potential ahead, with considerable room for further appreciation.”

The Sunbelt Advantage

For investors looking to enter or expand in the SFR space, Mendez positions Sunbelt Homes as a comprehensive partner. “We’ve earned the trust of major national institutions to deliver quality deals,” he notes. “We maintain an extensive network of property managers, contractors, and title companies covering all aspects of the SFR industry.”

This network allows Sunbelt Homes to offer investors access to off-market inventory and financially sound deals, while managing “all components of the SFR lifecycle.”

From a $500 investment in a piece of land to a multi-state operation working with institutional investors, Davis Mendez’s journey demonstrates the potential of strategic real estate investment. By combining market knowledge, technological innovation, and a commitment to transparency, Sunbelt Homes is establishing a distinctive position in the competitive SFR investment landscape.